The average mortgage size in Australia has reached an all-time high, with the average loan amount in New South Wales (NSW) surpassing AUD 800,000 for the first time.
On the 12th (local time), the Australian daily Sydney Morning Herald cited data released Wednesday by the Australian Bureau of Statistics (ABS), reporting that the average mortgage size across Australia for the December quarter last year increased by AUD 25,000 to AUD 666,000. Notably, the average mortgage size in NSW rose from AUD 767,000 in the same period last year to AUD 811,000, setting a new record high.
In Victoria, the average loan size increased from AUD 608,000 in December last year to AUD 632,000, though it did not reach the peak of AUD 639,000 recorded in June 2022. This is attributed to the construction of over 70,000 homes in the past 14 months.
In Western Australia (WA), the average loan amount approached AUD 600,000, marking an increase of about AUD 100,000 over the past year.
Nationally, the number of new mortgage loans rose by 2.2% during the last quarter of last year, marking the third consecutive quarter of growth. Consequently, the total mortgage loan volume reached approximately AUD 55 billion.
In NSW, however, the number of new loans decreased by 2.3%, partially offsetting this upward trend. Additionally, the growth rate of loans for first-time homebuyers nationwide was lower than the overall average.
As declining housing affordability and homeownership rates emerge as key issues ahead of the next general election, the government announced several measures on Tuesday to ease loan assessment criteria. One such measure allows banks to exclude student loan repayments from the debt-to-income (DTI) ratio calculation during loan assessments. For example, a graduate with an annual income of AUD 100,000 and a HELP student loan of AUD 60,000 could previously borrow up to AUD 540,000, but excluding the student loan from the calculation now allows borrowing up to AUD 600,000.
The increase in loan amounts beyond the number of new mortgages suggests that housing demand remains strong. Analysts also noted that low unemployment rates and tax cuts are partially offsetting the impact of high housing prices and rising interest rates.
Reserve Bank of Australia (RBA) (Photo: Jeong Dong-cheol)
Meanwhile, the Reserve Bank of Australia (RBA) is scheduled to make its first interest rate decision of the year next week, with Australia's four major banks expecting a 25 basis point (0.25 percentage point) cut at the February 18 meeting.
Madeline Dunk, an economist at ANZ Bank, explained, "While the ratio of mortgage repayments to household disposable income has reached an all-time high, mortgage delinquency rates remain at 2021 levels."
Meanwhile, investor loan numbers declined by 4.5% in the fourth quarter of last year, marking the first decrease since March 2023.
Housing prices in major Australian cities have fallen for four consecutive months, with Melbourne experiencing a price decline for ten consecutive months.
Marie Kilroy, senior economist at Oxford Economics, forecasted, "Although the nationwide housing supply shortage will somewhat cushion price declines, the slowdown in the Sydney and Melbourne markets is likely to continue until the first half of 2025."
Jeong Dong-cheol, Hanhotimes Reporter
※This article was written using content provided by Hanhotimes (www.hanhotimes.com).
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